$7.7 Billion In Auto Loan Fraud

A survey done by Point Predictive showed that 2021 was a record high year for fraud of varying types. The most common in the auto world being synthetic fraud (creating fake credit profiles), fake employers, misrepresentation of income, and straw purchases. This has Dealers all over bearing the bulk of the consequences. According to this same survey there has been $7.7 Billion in auto loan fraud alone. Misrepresentation of income has increased by 260% since 2020 and falsified paystubs by 22%. $1 Billion in fraud has been linked to an increase in fake employers. With all of these shocking numbers, here are some basic steps you can take to protect yourself.

Do Your Due Diligence

  1. Watch out for generic and vague job titles. Fraudulent individuals will usually keep things up for interpretation by labeling themselves as Manager, Sales, or office Manager. When you see titles like these do a little extra homework to verify this information.

2. Look at their stated income. Stats have shown that most fraudulent individuals keep their income in the $60-$80K per year range. This is a range that does not appear too high nor does it appear to low. It is easily believable and often slides under the radar.

3. Look out for the fake employers. Obviously you can’t tell this by reading it off the paper or form the customer completed. You need to do some homework here too. Go online and search the business name. Call the number that is listed. Verify this information before proceeding into your deal.

4. Do your due diligence! Set up a proper procedure to adequately verify customer information and don’t break the procedure. If you find gaps where something slipped through the cracks, assess the best way to patch the crack, do so and continue with your procedure. These simple but easily forgotten steps can save you a great deal of trouble in the long run.

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